Harding v LDC Finance Limited (in rec) HC Christchurch CIV 2008-409-1140 [2010] NZHC 976 (22 June 2010)

Last Updated: 29 June 2010

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

_{CIV 2008-409-001140}

BETWEEN ANDREW JOHN HARDING AND MURRAY SCHOLFIELD

Plaintiffs

AND STEPHEN DESMOND EATON AND SEDDON JAMES MARSHALL Applicants (Intending Second Plaintiffs)

AND LDC FINANCE LIMITED (IN RECEIVERSHIP)

Defendant

(On the papers)

Counsel: PRW Chisnall for plaintiffs and applicants

DJ Goddard QC and PJ Woods for defendant

Judgment: 22 June 2010 at 3:00pm

JUDGMENT OF ASSOCIATE JUDGE FAIRE [concluding matters referred to in judgment of 19 November 2009]

Solicitors: Gibson Sheat, Private Bag 31 905, Lower Hutt for plaintiffs and applicants

_{Anthony Harper, PO Box 2646, Christchurch for the defendant}

HARDING AND ORS V LDC FINANCE LIMITED (IN RECEIVERSHIP) HC CHCH CIV 2008-409-001140

22 June 2010

[1] This judgment concludes the matters referred to in my judgment of

10 November 2009.

[2] In that judgment I ordered that an inquiry be undertaken into the litigation privilege claimed by the defendant in respect of certain documents which are dated on or after 1 October 2007.

[3] I gave directions in a minute dated 24 November 2009 in respect of the inquiry. Unfortunately, the documents were not forwarded to me after they were filed by the defendant’s counsel. This position was discussed at a conference which I held on 15 June 2010 with counsel.

[4] Counsel were in agreement at the conference on 15 June 2010 as to how I should proceed with the inquiry. Some of the documents have now been disclosed by the defendant. A ruling is therefore not required in respect of those documents.

[5] Counsel for the defendant has assembled the documents that I am now asked to view. They are attached as tab 3 to the defendant’s counsel’s memorandum filed on 1 April 2010. I shall make an order at the conclusion of this judgment that the documents attached to that memorandum and the memorandum itself are to be placed in a sealed envelope and not to be opened without an order of the court. I am doing that to preserve the essential nature of the privilege that has been claimed.

[6] The test that I shall apply when I view the documents is to determine whether the privilege is properly claimed as codified by the Evidence Act 2006, s 56. That confers

privilege in relation to the communication or information only if it is made, received, compiled or prepared for the dominant purpose of preparing for a proceeding or an apprehended proceeding.

[7] In my judgment I determined that the proceedings were reasonably contemplated from 2 October 2007. There were, unfortunately, typographical errors in [74] and [76] of my judgment when the year recorded was 2009. The correct year is 2007. My judgment shall be corrected accordingly to show in those two paragraphs that the correct year is 2007. I apologise to the parties for that error in

the judgment. I am grateful to counsel, who have acted on the basis that it was simply a typographical error.

[8] When the method of inquiry was discussed with counsel I raised my concern as to how my reasons could be conveyed, particularly should I uphold the privilege claimed in relation to some documents or, for that matter, all of them. The concern I had was not to disclose information about the documents which would have the effect of negativing the privilege claimed. Counsel, recognising that position, advised me that all they required was my ruling.

[9] Despite counsel’s agreement I have decided at least to give a short summary of the areas of the documents that I have viewed. In some cases, although a reference is made to litigation privilege, the privilege seems to me to be clearly solicitor/client privilege. I have proceeded on the basis, however, that the documents are in fact clearly privileged and should not be disclosed. I reserve leave in this judgment if counsel for the plaintiffs requires a further explanation in relation to the designation as to type of privilege claimed. There are not a great number of documents to which this aspect relates.

[10] It is appropriate that I record that all the documents post-date Mr Chisnall, counsel for the plaintiffs, letter of 19 October 2007 to the receivers of the defendant. That letter clearly discloses that a claim is intended and, in fact, refers specifically to the possibility of protracted litigation between the parties. One of the documents that I have viewed bears the same date as that letter. Nothing turns on that position because it was clearly prepared as a result of the letter. I have no doubt at all that it is covered by litigation privilege.

[11] I have located, in my examination of the documents, six general categories of documents. They are:

a) How the defendant intended to respond to Mr Chisnall’s letter of

19 October 2007;

b) Documents pertaining to the defendant seeking advice on a joint statement by the defendant to creditors;

c) The approach which the defendant intended to take and the available options in relation to this dispute;

d) Correspondence seeking specific advice with regard to the litigation with the defendant’s specific response to the plaintiffs’ claims;

e) Correspondence relating to the pleadings; and

f) Advice sought by the defendant from solicitors concerning a personal matter, the content of which I will not disclose in this judgment. That matter clearly seems to me to be covered by solicitor/client privilege.

[12] The conclusion I have reached is that all of the documents for which privilege is claimed are in fact privileged. In one area the privilege is solicitor/client privilege. The documents concerned were so clearly covered by solicitor/client privilege that I have taken that position into account in the conclusion I have reached.

Orders

[13] Accordingly I order as follows:

a) None of the documents which are listed in tab 3 of the bundle of documents attached to the defendant’s counsel’s memorandum filed on 1 April 2010 are required to be produced because all are covered by privilege;

b) Because I have raised the possibility that the type of privilege claimed may have been incorrect and may not have been litigation privilege but is solicitor/client privilege, I reserve leave to counsel to make further submissions in relation to this aspect, should they wish;

c) The documents attached to the defendant’s counsel’s memorandum shall be placed in a sealed envelope and that is not to be opened except by order of this court;

d) I reserve costs in relation to the inquiry. The position outlined in [80]

of my judgment of 19 November 2009 shall apply to the inquiry, as it does to the disposal of the applications in their entirety.

JA Faire
Associate Judge